REP. BERNIE SANDERS

The Race To The Bottom

Many people throughout our country are now working longer hours
for lower wages than ever before. Some people now work two or three
jobs just to pay the bills, and today there are relatively few middle
class families that don't need both husband and wife to work for
economic reasons. In addition, more and more workers are seeing
substantial increases in the cost of health care, and cutbacks in
other benefits. Further, it seems that almost every day there is
another news story about a company that is laying off workers or
closing down altogether. More often than not, the jobs lost are the
kind of good-paying manufacturing jobs that families need in order to
have a decent standard of living.

The fact of the matter is, our disastrous national trade policy
has cost this country millions of decent-paying jobs, and has forced
wages down for many workers in Vermont and throughout our country.
The sad truth is that this country today now has a $346-billion trade
deficit. Between 1994 and 2000, the US lost more than 3 million
decent-paying manufacturing jobs due our trade policies. In 2001, the
manufacturing sector lost another 1.3 million jobs. Over the past
four years we have lost a total of 2 million factory jobs
representing 10% of the manufacturing workforce.

As a result of the decline in our manufacturing base, more and
more people are asking hard questions. They want to know why plants
are being shut down, and why workers are receiving pink slips. They
want to know why, when they go shopping, it is harder and harder to
find products manufactured in the USA. They want to know why major
American corporations seem to care so little about the working people
in their own country, and why the exorbitant compensation packages of
corporate CEOs seem to get even larger when they lay off workers.
Sometimes, officials and the media tell us that manufacturing jobs
are leaving Vermont because of the so-called unfriendly business
climate in our state.

The real problem is that Congress passed anti-worker legislation
such as the North American Free Trade Agreement (NAFTA), General
Agreement on Tariffs and Trade (GATT), Most Favored Nation (MFN)
status and Permanent Normalized Trade Relations (PNTR) with China, as
well as other trade legislation that benefits large multinational
corporations at the expense of working families. The devastating
truth is that "free" trade is not about exporting US manufactured
goods, it's about exporting American jobs. The real goal of free
trade is to lower labor costs everywhere, by allowing companies to
move production to wherever labor is cheapest. Eliminating tariffs in
the name of free trade allows corporations to do that without
penalty. Rather than pay Americans a living wage, they can hire
desperate workers in China for 20 cents an hour, and keep the
difference as profits.

To understand just how difficult it is for Americans to compete
against Third World workers, consider the hourly wages paid to people
who make apparel clothes and shoes in other countries: El Salvador
$0.59, Honduras 0.43, Haiti 0.30, China 0.23, Nicaragua 0.23; and
these are average wages, not minimum wages. Some workers earn even
less!

Can Vermont workers, or workers in South Carolina or California,
compete with workers in Honduras, Haiti or China? Of course not. So
jobs go abroad, because the labor costs are less. Ironically, even
workers in countries like Honduras have to worry about losing their
jobs to countries where wages are even lower. For example, if wages
are lower in Bangladesh, it is likely that the Hondurans' jobs will
end up there. So workers, states, and entire nations everywhere are
thrown into what is known as the Race to the Bottom. A race driven by
corporations that threaten to move their plants to countries with
lower labor costs if workers don't accept pay cuts. And it's a race
to lower not just wages, but also every benefit, worker safety
requirement, and environmental standard.

Free trade is bad news for all Americans. While those who lose
jobs are most directly affected by our failed trade policy, each of
our communities suffers as a result of the free trade policies pushed
by our presidents and approved by Congress. When corporations can
move their facilities to countries where workers make 20 cents an
hour, those corporations can use these horrendous wages as leverage
to get American workers to take pay and benefit cuts. Throughout our
country today workers are hearing their employers say, "If you are
not happy with the pay or benefit cuts we've established, we can take
your job to Mexico or China." When workers lose their jobs or suffer
pay cuts, they buy less from community businesses and local economies
suffer. One of the groups of Americans hardest hit by free trade are
young, entry-level workers without a college education. When
manufacturing jobs are available these workers are often able to earn
a living wage and receive decent benefits. With the collapse of our
manufacturing sector, the only jobs available to these young workers
are in the service industry.

Global trade can be good for American workers and the countries we
trade with when our trade functions have an underlying principle of
fair trade, not unfettered free trade. The goal must be to create
decent paying jobs in the United States, and improve the standard of
living of people abroad. The goal should not simply be to increase
corporate profits and the salaries of CEOs. We must act now to get
out of the fast lane in the race to the bottom.